U.S. Markets open in 1 hr 10 mins

Syngenta's 2013 Earnings Fall Y/Y

Zacks Equity Research

Syngenta AG (SYT) reported the financial results for 2013, with earnings per share, excluding restructuring and impairment charges, coming in at $19.30 (or $3.86 per ADR), down 12.4% from $22.03 reported in 2012.

Earnings per ADR of $3.86 lagged the Zacks Consensus Estimate of $4.34.


In the reported year, sales increased 5% to $14,688 million compared with 2012, at constant exchange rates (:CER), due to 3% increase in volumes along with 2% rise in prices. Revenues were lower than the Zacks Consensus Estimate of $14,707 million.

Europe, Africa and Middle East (:EAME), Latin America and Asia Pacific witnessed a healthy performance with sales growing 6%, 7% and 6% year over year, respectively, on a CER basis. However, revenues declined 2% in North America and 7% in Lawn and Garden segment.


Gross profit margin in the reported period fell 370 basis points (bps) year over year to 45.5%, on a CER basis. Earnings before interest, taxes, depreciation and amortization (:EBITDA) margin in the reported year was 19.0%, down 290 bps year over year, on a CER basis.

Adjusted operating income in the EAME segment increased 11% year over year to $1,448 million, while the same increased 6.9% year over year to $540.0 million in the Asia Pacific segment. Lawn and Garden segment’s adjusted operating income increased 54.5% year over year to $119.0 million, on a CER basis. Also, adjusted operating profit in the Latin America increased 1.3% year over year to $1,020 million.

Adjusted operating income for North America segment declined 21.4% to $1,074.0 million.

Balance Sheet/Cash Flow

Exiting 2013, Syngenta had cash and cash equivalents of $902.0 million, against $785.0 million on Jun 30, 2013. Financial debt and other non-current liabilities were $1.8 billion roughly flat compared with the preceding half year.

In 2013, Syngenta generated cash flow from operating activities of $1.2 billion, down from $1.4 billion in 2012. Capital expenditure in 2013 amounted to $625.0 million, up from $508.0 million incurred in 2012.

During 2013, Syngenta paid dividends totaling $921.0 million, along with share repurchases worth $66.0 million.


In 2014, management expects growth in integrated sales in a similar range as 2013. Gross margin is expected to increase in the coming quarters. Free cash flow before acquisitions is expected to reach $1.5 billion in 2014.

Moreover, the company expects to reach a sales target of $25 billion by 2020. Also, EBITDA margin is targeted in the range of 24%–26% by 2018. It is also expected that the cash return to investors will continue increasing via a hike in dividend payments.

Other Stocks to Consider

Syngenta currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include Gruma S.A.B. de CV (GMK), Archer Daniels Midland Company (ADM) and Bunge Limited (BG). While Gruma and Archer Daniels sport a Zacks Rank #1 (Strong Buy), Bunge Limited carries a Zacks Rank #2 (Buy).

Read the Full Research Report on SYT
Read the Full Research Report on ADM
Read the Full Research Report on BG
Read the Full Research Report on GMK

Zacks Investment Research